Taiwo Oyedele, the chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, has listed ways Tax Reforms will benefit Nigerians.
Through a post on his X account on Monday, December 9, Oyedele highlighted ways households and individuals including the youth, small businesses, businesses and investments, high income earners and HNIs and subnational governments can benefit from the reforms.
According to Oyedele, there is something in the tax bills for everyone.
Here are ways you can benefit from tax reforms:
A. Households and individuals including the youth:
1. Complete exemption of low-income earners up to N1m p.a. (about N83k per month) from PAYE.
2. Reduced PAYE tax for those earning a monthly salary of N1.7m or less.
3. Zero (0%) VAT on food, healthcare, education, electricity generation and transmission.
4. VAT exemption on transportation, renewable energy, CNG, baby products, sanitary towels, rent and fuel products.
5. Tax break for wage award and transport subsidy to low-income earners.
6. Tax incentives for employers to hire more people incrementally than in the previous 3 years.
7. Exemption of stamp duties on rent below N10m.
8. PAYE tax exemption for other rank and armed forces fighting insecurity
9. Friendly tax rules for remote workers and digital nomads.
10. Clarity on taxation of digital assets to avoid double taxation and allow deduction for losses.
B. Small Businesses:
1. Increase in tax exemption threshold for small businesses from annual turnover of N25m to N50m.
2. Exemption from company income tax for small businesses (tax at 0%).
3. No withholding tax deduction on business income of small businesses.
4. Exemption from the requirement to deduct and account for tax on payments to vendors.
5. Simplified statement of accounts attested to by small business owner for tax returns in place of audited financial statements.
7. Tax disputes affecting businesses to be resolved within 14 days by the Tax Ombud.
8. Harmonisation of taxes and repeal of multiple levies.
9. Outlaw cash payment and physical roadblocks imposing burden on businesses.
10 Attractive tax regime to encourage formalisation of business and facilitate growth.
C. Businesses and investments:
1. Reduction of corporate income tax rate from 30% to 25% and harmonisation of earmarked taxes at a reduced rate.
2. Unilateral tax credit for income earned abroad to avoid double taxation and input VAT credit on assets and services to reduce cost of production.
3. Introduction of economic development incentive for priority sectors.
4. Friendly tax regime for business restructuring and reorganisation to improve efficiency.
5. Clarity on 6-years statute of limitation and resolution of objections in favour of taxpayers if tax authority fails to respond within 90 days.
6. Option to pay taxes and levies on foreign currency denominated transactions in Naira.
7. Faster tax refunds within 90 days (30 days for VAT refunds) with the option of set-off against any tax liability of the taxpayer.
